Artificial intelligence is moving from a technology topic to a strategic factor in international affairs and energy markets. As governments and companies race to build and expand AI infrastructure, the implications extend far beyond chips and algorithms into electricity systems, diplomatic alliances and energy planning for 2026 and beyond.
AI and energy demand
Advanced AI models and the data centres that power them consume significant amounts of electricity and water. The International Energy Agency projects that data centre electricity use could double by 2030 as AI workloads grow, placing sustained demand on grids and suppliers. Estimates suggest AI-related power demand could account for a growing share of global consumption, prompting regulators and utilities to reassess capacity and connections to avoid bottlenecks.
This surge has real consequences. In Great Britain, regulator Ofgem warns that proposed data centres could require up to 50 gigawatts of electricity, surpassing current peak demand and potentially crowding out other energy priorities. In the United States, massive AI expansion plans are already bumping up against grid constraints, leading some operators to build dedicated generation capacity.
Energy markets under strain
These energy demands occur alongside persistent geopolitical pressures in commodity markets. Trade tensions, policy uncertainty and uneven supply investment continue to influence oil and gas prices, even as traders anticipate diplomatic efforts to avoid major disruptions. At the same time, energy companies are adapting their strategies: some utilities in Europe are increasing grid investments to cope with new load patterns tied to computing demand.
Crucially, AI’s energy footprint intersects with broader sustainability goals. While AI has the potential to optimise energy systems and improve efficiency, its rapid build-out also risks slowing the retirement of fossil fuel plants and raising emissions if grids cannot keep pace with demand from renewables.
Geopolitical competition and supply chains
Beyond energy consumption, AI has become a subject of diplomatic strategy. The United States launched the Pax Silica initiative in late 2025, aimed at securing cooperation on AI infrastructure, semiconductors, critical minerals and related energy and data networks with partner countries. Meanwhile, international forums such as the AI Impact Summit have seen major countries commit to shared principles on ethical and equitable development, signifying a multilateral dimension to AI governance.
This interplay between technology, energy and geopolitics means that energy security is now part of AI competition. Countries capable of delivering reliable, affordable power at scale will have an advantage. Governments are recalibrating energy policy, trade relations and diplomatic ties to reflect this new reality.
